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Charter sets talk on $7.4 billion in term loan G and term loan H debt
By Sara Rosenberg
New York, July 31 – Charter Communications Operating LLC released price talk on its $3.2 billion six-year term loan G and $4.2 billion seven-year term loan H with is bank meeting on Thursday, according to a market source.
Both term loans are talked at Libor plus 275 basis points to 300 bps with a 0.75% Libor floor, but the term loan G is offered at an original issue discount of 99½ and the term loan H is offered at a discount of 99, the source said.
Also, both term loans have 101 soft call protection for six months.
Commitments are due on Aug. 8, the source added.
The company is also getting a $1 billion incremental term loan A and a $500 million incremental revolver.
Goldman Sachs Bank USA, Bank of America Merrill Lynch, Credit Suisse Securities (USA) LLC and Deutsche Bank Securities Inc. are the lead banks on the senior secured deal (Ba1/BB+).
Proceeds will be used to fund the acquisitions of customers and systems from Comcast Corp.
The acquisitions are conditioned on the completion of the merger of Comcast and Time Warner Cable, as well as the receipt of Hart-Scott-Rodino, FCC and other required regulatory approvals, Charter shareholder approval and various other matters.
Under the agreement, following the close of the Comcast-Time Warner Cable merger, Charter will buy systems serving about 1.4 million of the prior Time Warner Cable video customers for an estimated value of $7.4 billion based on projected 2014 EBITDA.
In addition, Charter will own about 33% of the new publicly traded cable provider (SpinCo) to be spun off by Comcast serving about 2.5 million customers, and Comcast shareholders, including the former Time Warner Cable shareholders, will own about 67% of SpinCo.
Charter will acquire its interest in SpinCo by issuing stock to Comcast shareholders.
Charter is a Stamford, Conn.-based broadband communications company and cable operator.
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